Housing Afforability: Open Letter to Minister

Following introduction of an
Inclusionary Zoning Bill to the NZ Parliament.

The letter
sets out the three key areas –including seven performance
indicators – that need to be focused on in starting to
address the housing affordability issue. These policy
suggestions are applicable to most jurisdictions.

The tragedy of this is that there has been
so much progress made with diverse groups over the past
three years, as I outline within my letter to the Resource Management Law
Association people mid November.

Your response Developers’ response predictable but out
of touch to the Property Council was unfortunate and ill
advised. It would appear your officials do not understand
the difference between an “investor” and a
“developer” and that by far the majority of the full
membership (professionals are admitted as associates) of
this organisation is made up of commercial property
investors (the residential investors organisation is the
Property Investors Federation). We do not have a
representative body as such in New Zealand for developers
(because of New Zealand’s small size) as is the case in
Australia with the Urban Development Institute (of which I
am a fellow).

Within the release you said “I am not
surprised by its response because it (the Property Council)
has a vested interest in maintaining the status quo, which
is profit focused and fails to account adequately for the
needs of the aspiring first home – buyer”.

Then the
body of your release is padded out with “the sun rises in
the west” development economics (which I will deal with
later within this letter) and concludes with “If the
Property Council thought this Bill was designed to lower
land costs (you had changed your mind on this in a
subsequent National Radio interview incidentally –
hyperlink above) or free up land supply, it is confused.
This is just one of a number of initiatives being undertaken
and considered (most consider before they undertake –
although in the case of this Bill you are quite correct -
regrettably) by the government to address a complex
issue”.

The reality is of course (contrary to your
assertions) that the Property Council has a “vested
interest” in acting as cheerleaders to the ill informed
within local government strangling land supply and creating
artificial property inflation. Opening up land supply to
create greater competition with the existing (currently
protected) stock they own – is hardly in their own ‘self
interest”. It was for this very reason that the Property
Council and I parted company 12 years ago (I was at the time
South Island President) – but since that time and with a
membership that has “matured” and better understands its
social responsibilities with its Chief Executive Officer
Connal Townsend – it felt compelled to express its very
real concerns about this Bill.

You need to bear in mind Ms
Street - that it was way back in September last year (15
months ago) when you predecessor Hon Chris Carter ( now
Education Minister) gave a speech “Public and private
opportunities in affordable housing” to the Real Estate
Institute, where he spelt out clearly the problems and
indicated that there had to be greater cooperation between
the private sector and government in solving this
issue.

What happened instead – is that the issue became
a “closed shop” insofar as the government was concerned
– and this “pathetic” Bill is all that’s eventuated
after fifteen long months. The reality is that your
Government has simply being playing games with this serious
social issue.

You will be aware that Demographia takes a
“facts and figures” and structural approach to this
issue and its only interest is to explore politically
feasible ways of restoring housing to the internationally
recognised standards - where housing does not exceed three
times annual household income. Internationally, there is no
longer any serious debate within reputable political and
academic circles of the causes of artificial housing
inflation – and I would strongly urge you to access much
of the international research on the Demographia website and elsewhere.

It
is clear to me that the “closed shop” (just central
government agencies with an element of “like minds” from
local government) involved in the preparation of this Bill
had their “ideological blinkers” on when drafting it and
sadly also appear to have little understanding of elementary
development economics. In fact they failed to consult those
with practical experience in providing housing – as the
supporting documentation illustrates. It is appreciated too
– that as a former academic and new to this position that
you are struggling with an understanding of development
economics (your interview on National Radio clearly
illustrated this).

The ideological approach you have
accepted from your officials must stop. Those days are well
and truly over. Internationally over the past twenty years
or so there has been a growing convergence in politics –
where the focus today is on “what works”. The New
Zealand public will of course judge you and your Governments
performance based on this in less than twelve months
time.

LESSONS FROM AUSTRALIA?

Research is only now just
coming to light as outlined within this Sydney Morning
Herald article of Saturday December 8, 2007 by Stuart
Washington Fear of losing homes drove Labour win
– where the former Howard Liberal Government “paid the
price” in the voting booths, for its failure to
effectively play its part I addressing these housing
affordability issues.

The new Australian Labour Government
Prime Minister Hon Kevin Rudd expressed it very well in his
recent Victory Speech (Video here ) when he said –

“I
will be Prime Minister for all Australians. I will make this
solemn pledge to the nation: I will always govern in the
national interest. And my door will always be open to men
and women of goodwill who want to participate in making our
country even greater in the future.

Friends, tomorrow the
work begins. Australia’s long term challenges demand a new
consensus across our country. I’m determined to use the
Office of Prime Minister to forge that consensus. It is
necessary for us to embrace the future as a nation united,
forged with a common vision.

I want to put aside the old
battles of the past, the old battles between business and
unions, the old battles between growth and the environment,
the old and tired battles between federal and state, the old
battles between public and private.

It is time for a new
page to be written in our nations’ history. The future is
too important for us not to work together to embrace the
challenges of the future and to carve out our nation’s
destiny.

Knowing people who have worked closely with Kevin
Rudd in Queensland (when he was Chief of Staff to Premier
Wayne Goss), his recent Cabinet announcements and “laying
down the law” at his first Cabinet meeting regarding
“financial conflicts of interest” – it is my view,
that he means what he says.

With Hon Jenny Macklin inside
Cabinet responsible for Housing and Hon Anthony Albanese
chosen to head up Infrastructure, it is likely we will see
the Rudd Government deal effectively with the States and
Local Government on the serious housing issue in
Australia.

It is therefore of critical importance the New
Zealand Government stop playing ideological games (and
incidentally – insult our intelligence) with this serious
housing issue, withdraw this destructive Bill and start
focusing on exploring real solutions. For obvious reasons
(well at least I hope they are) the New Zealand Government
has no option other than to treat this issue with urgency
and sound judgement, so that in a measured and realistic
way, we expand our “affordability advantage” over
Australia. No doubt you will be acutely aware of our migration trends over recent years,
where increasingly, Australia is seen to be more
desirable.

I see no reason why New Zealand cannot get
sound policies in place to reverse these migration
statistics – with a housing affordability advantage being
one of the key drivers.

DEVELOPMENT REALITIES

In the
interests of keeping this discussion constructive and
positive I will refrain from embarking on a “line by
line” review of your announcement, the Bill and your radio
interview. Instead I will focus on outlining some important
elementary aspects of development economics (yes – I have
been a development practitioner for thirty years, an
industry leader for over three years and an international
housing researcher the past three years) – and most
importantly – sketch out a suggested way forward in
dealing with this issue over a reasonable and realistic time
frame.

Within your Government there appears to be an
element with a poor understanding through to a hostile
attitude to business. In my view – it is just as
destructive on the other side of the political spectrum with
those who “suffer” from hostility to government. The
biggest problem for those taking these extremist positions
– is that it seriously impairs their political
judgement.

The reality is that developers and builders are
simply “manufacturers” of property – endeavouring as
best they can within the regulatory restraints and
commercial realities, to provide their customers with the
highest standard “products” possible (if they don’t
– their competitors will). The developers’ role is to
take overall responsibility for the commercial and
regulatory risks involved, absorb the unforseen
contingencies and manage the extensive organisational
requirements of the project, with the builder employed for
the physical construction works. In this work – the
developer works with the regulatory authorities, architects,
engineers, builders, surveyors, valuers, quantity surveyors,
financiers, real estate agents, land owners, tenants, end
purchasers, adjoining property owners and many others. It is
the developer’s responsibility to ensure that the project
is “financially viable” and if he fails in this regard,
his / her reputation is seriously impaired. Contrary to
popular mythology (prevalent I might add within the academic
circles you came from) the major asset a developer has is
“reputation”. This asset is not acquired in five minutes
– but takes years of consistently sound performance to
establish. At its core - “reputation” is
“trust”.

We have a saying in the development business
- “rooster today – feather duster tomorrow”.
Developers know well that if they fail to act in a
responsible way, lose money and inflict damage on others –
their major asset “reputation” can vanish overnight.
There is nothing more serious than losing the “trust” of
those one deals with.

Politicians suffer the same fate too
– when people lose “trust” in them. There is no sadder
sight in my view than a politician thrown out of office and
stripped of the (so called) power, perks and influence they
once enjoyed – when their “customers” - the voters
lose trust in them. The first things to go are the
“friends”.

Developers have very strict financial
guidelines they must work to - imposed by their lenders,
prior to being in a position to give projects the “green
light” (the lenders are particularly interested in past
performance – reputation). We are currently in a global
credit contraction phase, where the guidelines as such are
becoming even stricter. Lenders insist on a projected profit
cushion to reflect the commercial and regulatory risks,
unforseen contingencies (these always happen). complexity
and scale of the proposed projects – to protect themselves
of course.

This lack of elementary development
knowledge is illustrated clearly within the explanatory
notes of your Tuesday announcement, where the public
servants involved obviously have no knowledge whatsoever in
the subject. You need to ask them why they failed to consult
with those with a proven track record of development
performance – prior to embarking on the preparation of the
Bill. Ultimately – it is you who will be judged – and
with respect, I would suggest that you need to decide rather
quickly whether you are going to provide the necessary
leadership with this issue – or by default - allow the
officials with their selected friends from the local
government sector to “run the cutter” to suit their
ideological fancies.

It’s your call.

STOP PLAYING
GAMES – FOCUS ON REAL ISSUES

Let’s now turn to
discussing this issue in more positive terms.

It is
extremely clear to me in having researched this over the
past three years – how this issue needs to be progressed
in New Zealand (and Australia for that matter). And the
issue is not at all “complex”.

The reason why we have
a housing affordability crisis – is (again) simply because
we are not building affordable housing.

The international
standard for “affordable” is that housing should not
exceed three times gross annual household incomes and that
normal urban markets should move between a “floor
multiple” of 2.5 times gross annual household income
through to a “ceiling multiple” of 3.0 times household
income – and the “swing multiple” between these two is
around 2.7 times household income. In this regard the Annual
Demographia Surveys are “staring us in
the face”. Other than for those – who prefer to devy
reality.

To ensure that these affordability levels are
maintained – the ONLY WAY is by allowing sufficient new
housing construction on the fringes, where the land is
cheapest (something it would appear your officials are
unaware of at this stage), so that new starter housing is
put in place at “development ratios” of 20 to 25% going
towards the lot / section and the balance 75 to 80% going to
the actual house construction. I would urge you to read the
Demographia Dallas Fort Worth / Sydney Fringe Starter
Housing Comparative Study where links are provided
through to Dallas Fort Worth Builder Websites (13 in total)
– and where they are putting in place new starter housing
all up for $US700 per square metre - $US550 to the building
and US150 for the lot / section. A fringe new starter home
of 200 square metres on a lot of 500 square metres therefore
costs $US30,000 for the lot and $US110,000 for the actual
construction – all up $US140,000.

You will note in
reading the 2007 3rd Edition Demographia Survey (refer Page
33), that the annual gross median household income is $US56,
200 in Dallas Fort Worth – so for fringe starter homes of
200 square metres on 500 square metre lots – this clearly
illustrates that they are putting in place this type of
housing on the fringes at 2.49 times the median annual gross
household income of that urban market. By allowing fringe
development as they do within the 42 affordable North
American markets – it acts as a “supply vent” or
“inflation vent” so that these urban markets do not
inflate, which regrettably is not able to happen in New
Zealand and Australia (and the UK, Ireland and coastal North
American urban markets for that matter).

So for us to
restore housing affordability in New Zealand and Australia
we need to be thinking in terms of starting in to the
process, so that over a reasonable and realistic time frame,
we are putting in place new fringe starter housing of 200
square metres on 500 square metre lots at 2.5 times the
annual gross household income of each particular urban
market.

Dense type concrete apartment construction
generally costs around twice as much to build on a square
metre basis as “bricks and sticks” stand alone housing
– so this would suggest that on a capital cost basis, it
consumes around double the energy on a square metre basis.
Further to this, the Sydney Morning Herald within an April
article High Density a Failure deals with a
Report “Power Politics and Community” published by the
Griffith University Urban Research Program and written by
Glen Searle, Director of the Planning Program at the
University of Technology, Sydney. This Report spells out the
massive failings of these unpopular urban consolidation
policies in graphic detail.

A publication released by the New South
Wales Government “Multi Unit Residential Buildings Energy
and Peak Demand Study” prepared by Rachel O’Leary and
Rob Helstroom of the NSW Department of Infrastructure,
Planning and Natural Resources, October 2005, illustrates
how on a per occupant basis, dense type developments, on an
operating cost basis (capital costs are omitted), are
considerably less energy efficient than stand alone
housing.

This of course would not be helped with the
“urban heat effect” and the lack of green space and
trees urban compaction creates.

We do know too from a
social perspective, that there is a strong correlation
between lower density and people’s greater community
involvement as illustrated by the important research paper
of 2006 Social Interaction and Urban Sprawl by
Jan D Brueckner, Department of Economics, University of
California Irvine and Ann G Largey, Dublin City University
Business School.

On the economic front - the highly
respected commentator on social and urban issues Joel
Kotkin, Presidential Fellow in Urban Futures at Chapman
University, California, in his recent paper for the New
America Foundation Back to Basics: A Pro Growth Public
Investment Strategy sets out clearly why it is important
for governments at all levels to ensure that that focus must
be on sound infrastructure provision and on going
management.

If the lot / section costs for starter housing
are driven up from the sound 20 – 25% of total costs so
that they “consume” a greater percentage of the total
package to say 50% (where New Zealand urban markets sit
roughly at the moment), 60%, 70% (where Sydney is and
Auckland is heading), 80% (where London is) – the only
things that can “give” are the quality and sizes of the
housing. I expand on this issue further within my recent letter to the Resource Management
people.

In using the Dallas Fort Worth
example outlined earlier as a guide – we need to be aiming
over the long haul to get new fringe starter housing of 200
square metres on 500 square metre lots (using the above
income figures and the 2.5 times gross annual household
income guide) – that new starter fringe housing for
Auckland should be $NZ143,750 – for Christchurch $121,000
and for Wellington $NZ168,500. In the range of $NZ120,000 to
$NZ170,000 around the fringes of our urban markets, using
the September Quarter 2006 data as a base, We are a million
miles from these figures currently and it will take many
years to repair the damage to our construction industry and
on a phased basis release land and put in place sound
infrastructure debt financing arrangements – to restore
these levels of affordability enjoyed by earlier
generations.

THE UNITED NATIONS PROVIDES US WITH
GUIDANCE

We do know that most New Zealanders aspire to a
stand alone house with a reasonable amount of land around
it. One only has to glance at the Statistics New Zealand Monthly Building
Consents to see how many stand alone housing units are
built in comparison with dense apartment type housing. The
latter is of course miniscule. It would appear again that
your officials have failed to alert you to the United
Nations 2007 World Population Report where it
states within the Introduction –

“Once policymakers
and civil society understand and accept the demographic and
social composition of urban growth (my view – stop being
elitist) some basic approaches and initiatives suggest
themselves. These could have a huge impact on the fate of
poor people and the viability of cities themselves,
Throughout the Report the message is clear. Urban and
national Governments, together with civil society and
supported by international organisations, can take steps
that will make a huge difference for the social, economic
and environmental living conditions of a majority of the
worlds population.

Three policy initiatives stand out in
this connection. First – preparing for an urban future
requires at a minimum, respecting the rights of the poor to
the city. As Chapter 3 shows, many policymakers continue to
try to prevent migration and urban growth by discouraging
rural – urban migration……

..These attempts to
prevent migration are futile, counterproductive and above
all wrong – a violation of peoples rights.

For poor
families, having an adequate piece of land – with access
to water, sewage, power and transport – on which they can
construct their homes and improve their lives, is
essential.”

Rather surprisingly – it would appear
(again) that your officials have failed to advise you of the
United Nations Department of Economic and Social Affairs –
Division for Sustainable Development – Urban Indicator
Programs ( here and here ) with the World Bank ( here ), where both these organisations
work closely in promoting the programs. As I see it – we
should be making full use of these excellent guidelines –
and I would be interested in learning from you if New
Zealand is a signatory to these Urban Programs – and if we
are – why we are not currently employing them? In the
event we are not – I would be most interested in learning
why this is the case.

THREE MAJOR AREAS – WITH SEVEN
INDICATORS FOR LOCAL GOVERNMENT

In thinking through this
issue – I am strongly of the opinion that we need to be
focusing on three major areas – being –

(1)
Incorporating Housing Performance Standards in to the Local
Government Act. It is critically important local government
has a reasonable number of easily understood measures /
indicators to work to – to start on the path to restoring
housing affordability within its area of responsibility,
over a reasonable and realistic time frame. Without these
– we are simply talking “hot air” with this whole
issue.

To assist in this regard, a socially responsible
private organisation will be generating a New Zealand
National Median Multiple Survey of our regions and
significant urban markets for release at the time of the 4th
Edition International Demographia Survey 21 January 2008 –
with one for the British market at the same time. An
Australian National Survey will be generated a few months
later.

(2) Require Local Authorities to phase out fringe
urban land scarcities as soon as possible. Local Authorities
need to clearly identify areas outside their fringes that
are “off limits” to development for rigorously
researched heritage and environmental reasons – and allow
both residential and commercial development to respond to
peoples needs and requirements on the urban fringes. To
suggest that New Zealand and Australia are running out of
land can only be described as “delusional ideological
drivel”. With respect to New Zealand - I set out our land
use realities within a brief article Scoop: New Zealand Lifestyle Block
Mythology – where of course (at the overall
Christchurch urban density of 1,900 people per square
kilometre) just 0.67% of our total land area is urbanised
– and we would require a further 0.20% (one fifth of one
percent) of our land area to urbanise a further one million
people.

(3) Require Local Authorities and other
Infrastructure Providers on a phased basis to appropriately
debt finance infrastructure. This is an issue Local
Government is having the most difficulty with - and in my
considered opinion – over these past years has been the
major driver (more so than ideology – which is in reality
“sanctimonious ignorance”) of forced urban consolidation
“sold” with the Orwellian term of Smart Growth, which
should be correctly termed Dumb Density.

There is
obviously an urgent need to lift governance and management
standards on an ongoing basis, within the local government
sector. It could best be described at the moment as “Parkinson’s Law on Prozac” – with
rates and revenue requirements well outside the inflation
rate – where the focus is to generate revenue from all
sources to feed these insatiable bureaucratic beasts. This
is why I stress the importance of “performance
standards” with respect to housing – but these are also
required across the whole spectrum of local government
activities.

The reality is that those who own the
infrastructure should be responsible for the appropriate
financing of it – for obvious reasons if economic
efficiency and intergenerational equity. The current
practice of “developer levies” (which they are not –
because the developer is only an intermediary – and passes
these costs, with a margin, to the new home purchaser) are
unsound – and appropriately should be debt financed by the
infrastructure provider, to refect the expected operational
life of the particular asset.

It would appear too that
Local Authorities are experiencing some considerable
difficulties in applying appropriate depreciation rates to
particular assets – as they are required to do under the
provisions of the Local Government 1996 no 3 Amendment Act.
I have not followed this issue in recent years – and it
has been suggested to me that some Authorities are “over
depreciating” to assist in generating more revenues.

In
any event – there is an urgent need for research of this
issue – in how Local Authorities are managing their assets
and debt financing them. My understanding is that a private
organisation will likely be getting research underway on
this issue in early 2008.

With respect to (1) above, it
is important Local Authorities are provided with guidance on
appropriate measures and indicators, so that they can have a
clear “snapshot” of the state of the housing and trends
within their areas of responsibility . There is no need
whatsoever for these measures and indicators to be
“complex” (after all this whole issue is not
“complex”) and I would suggest with respect to housing,
that there are only seven – one key indicator with six
supplementary ones.

(a) Key Indicator – Median Multiple
and Trends – as recommended and employed by the United
Nations World Bank, Demographia and others. There is no
“perfect” measure as such, but the Median Multiple
(median house price divided by median gross annual household
income) could be described as the “most adequate”.

(c) Supplementary Indicator Two – Total
Housing Stock / Usually Occupied Housing Stock / Per 1000
Population. This could be expressed as for example 380 /
360 per 1,000 population as the case may be. This measure is
in common usage in Western Europe and employed by the
leading international professional property organisation,
the Royal
Institution of Chartered Surveyors (RICS). With this
measure one can gauge fairly quickly (coupled with the other
measures) the demand pressures within individual urban
markets and local authority areas.

(d) Supplementary
Indicator Three - Annual Build Rates per 1000 population and
trends. Expressed as 6 / 1000 or whatever as the case may
be. New Zealand is currently generating new residential
units at the rate of slightly under 6 / 1000 (24,000
residential units currently being put in place annually for
a population of around 4.2 million). Back in the mid
1970’s we were putting in place in excess of 12 / 1000.
During 2006 the Republic of Ireland put in place 20 / 1000,
likely around 16 / 1000 this year and 12 / 1000 during 2008.
Western Europe is currently building around 5 / 1000, the
United States this year 4 / 1000 (it had been up to 7 / 1000
a couple of years ago) with Texas hitting 9 / 1000 last year
and currently the “basket cases” of California and
Britain 3 / 1000 or slightly below. A build rate of between
2 to 3 / 1000 is required for replacement alone –
depending mainly on the age of the residential stock.

(e)
Supplementary Indicator Four -Age of Housing Stock in
Decadal Bands. It is critically important to have this
information to gauge the likely replacement housing stock
going forward. You will be aware that in international
terms, the quality of our housing stock is considered poor,
as again outlined within a recent The Press article Government urged to lead way on housing
reporting on the findings of Beacon Pathways – comprising
industry, local government and research organisations.
Regrettably, this group failed with its suggested solutions,
because it did not recognise the key reasons (as I am doing
within this letter) why our housing stock is of such a poor
standard. Further reading Maori, Pacific children at health risk -
Stuff.co.nz .

(f) Supplementary Indicator Five -
Fringe Urban Values including fees / True Rural Values per
hectare. With respect to fringe urban values it is important
infrastructure fees are added so that the true distortions
are not masked. In assessing the True Rural Values it is
important that ones sufficiently distant from our urban
markets are used, so that the current “urban echo
values” are ignored. These are of course “artificial
values” created by the excessively priced fringe raw urban
land encouraging speculative activity by those in adjoining
rural areas hoping for an urban rezoning. This measure could
be simply expressed in dollar amounts – say $NZ30,000 /
$1,200,000 – as the case may be. This measure would assist
Local Authorities in dealing with these artificial fringe
urban prices as quickly as possible. We need to avoid at all
costs, the deliberately misleading “years of supply”
measure currently employed by the Australians – which is
used simply to mask the Rolls Royce pricing of lots /
sections.

(g) Supplementary Indicator Six - Residential
Rental Vacancy Rate. Rather surprisingly, we do not have
regular information on the ever changing demand and supply
status of the important housing segment in New Zealand. At a
glance, we should know the monthly vacancy rates for all
local authority areas. We do know for example that in
Australia, the residential vacancy rates within the major
urban markets (and other markets too – particularly those
near mining activities) are at critically low levels of near
1% and it would appear that there is a rental crisis looming
in Auckland, according to a recent New Zealand Herald
article by Anne Gibson Expect rent rise, tenants warned . The
situation is currently “tight” in Wellington as
well.

The reality is that in normal properly functioning
urban markets, residential rental vacancy rates should not
fall below 6%, to act as a “supply cushion” and allow
the construction sector to respond with increased supply so
that rental increases are moderated.

In Dallas Fort Worth
and Houston it only took a 2 to 4% lift in rentals and for
vacancy rates to fall below the 6% mark to trigger a rapid
response in apartment building – as these recent articles
from the Dallas Morning News by Steve Brown DFW apartment market profiting from housing
crunch and the Houston Chronicle by Nancy Sarnoff with
the misleading header Housing slump hits renters in wallets .
A graph (again misleading with its high base) within the
article illustrates how rentals on average within Houston
have moved from $US657 per month in October 2006 to $US681
per month in October 2007 – a “massive” 3.6% a year in
an urban market with a population of 5.6 million people and
a population growth rate of in excess of 2% annually. At
$US681 per month, that represents $US157.15 per week, which
of course includes local authority rates / property taxes.
No wonder some are in no hurry to purchase homes, when they
are getting good rental deals like this!

The 3rd Edition 2007 Demographia Survey
(refer Page 34) shows that Houston had a Median Multiple of
2.9, based on a median house price of $US152,800 and a
median annual gross household income of $US53,000. The
Houston and Texas economy is currently performing very well
as illustrated by this excellent commentary recently released by Wachovia
Bank. In roughly adjusting household incomes 5% since that
time (note table in the report illustrating lift in
household incomes – adjust for population increase) and
the median annual household income is now in the order of
$US55,650 and with the average apartment rent in Houston now
$$US681 per month ($US157 per week) or $US8,172 per annum
– this would suggest that the average annual gross rental
is 14.48% of median annual gross household incomes. This is
however comparing “apples with oranges” – medians with
averages.

Lets for the point of discussion make a 20%
downwards adjustment to the average rental figures to get a
rough estimate of median rentals (more research is required
on this issue) so that the “average” annual rental of
$US8,172 is bought back to a (guessed at) “median”
figure of $US6,537 (note adjusted median household income
now likely to be about $US53,650). This would suggest that
Houston median apartment rentals may well be about 12.18% of
annual gross median household incomes.

No wonder people
and their family’s have more disposable income left over,
in these affordable urban markets.

Again – further
research is urgently required on this issue in comparing the
“rental stress” of our inflated New Zealand and
Australian urban markets, with the affordable North American
ones.

LOCAL GOVERNMENT DESERVES CARING LEADERSHIP

It is
my strong view that many of the good people working for
their communities in local government would welcome central
government leadership in providing greater clarity and
guidance and the incorporation of performance standards
within the appropriate legislation. With respect to
environmental issues - the Resource Management Act and
social and economic issues (including housing of course) -
the Local Government Act. You need to understand I have been
dealing with these people for around thirty years – so I
do have a good grasp of the “trials and tribulations”
these people experience in the important work they do for
their communities.

In fact I have a strong affection for
local government and want to see it strengthened, where the
individuals involved with it, can take pride in improved
performance and the knowledge that they have the
opportunities to better serve their communities, It saddens
me greatly to encounter good people within the local
government sector who are demoralised and just “going
through the motions” - because they are not getting the
quality central and local governance and senior management
support they deserve.

There has been no research done on
the performance and difficulties experienced by local
government regulatory staff in New Zealand that I am aware
of. However the Australian Planning Institute embarked on a
National Inquiry in to Planning
Education and Employment during 2004 and found significant
demoralization and high attrition rates with planning staff.
I suspect we would find the same in New Zealand. I am sure
much of this is due to a lack of governance and senior
management discipline, where Parkinson’s Law has been
allowed to take hold.

It is obvious to me Ms Street - that
there is a need to stop playing games – and start to focus
on the real issues. I wish you every success in providing
the necessary leadership, to assist us all in starting on
the path of restoring housing affordability in New
Zealand.

Scoop Citizen Members and ScoopPro Organisations are the lifeblood of Scoop.

20 years of independent publishing is a milestone, but your support is essential to keep Scoop thriving. We are building on our offering with new In-depth Engaged Journalism platform - thedig.nz.
Find out more and join us:

The focus of Labour’s alleged sexual assault scandal has now shifted from the party organisation to the Beehive... This is now a crisis of Beehive management and response, not something occurring at a distance within the party organisation.

Presumably, the QC appointed to clarify what happened will eventually shed light on key issues. Such as: on what date prior to the publication of the original Spinoff article did the party hierarchy/PM’s office/PM’s press secretary realise they were dealing with a sexual assault allegation, and what did they do about it at that point? More>>

ALSO:

An official pardon for Tūhoe prophet and leader Rua Kēnana is one step closer after the Te Pire kia Unuhia te Hara kai Runga i a Rua Kēnana: Rua Kēnana Pardon Bill was read in Parliament for the first time today. More>>

“We have listened carefully to the growing calls from New Zealanders to know more about our own history and identity. With this in mind it makes sense for the National Curriculum to make clear the expectation that our history is part of the local curriculum and marau ā kura in every school and kura,” Jacinda Ardern said. More>>

Jacinda Ardern: “This morning I was provided some of the correspondence from complainants written to the party several months ago. It confirms that the allegations made were extremely serious, that the process caused complainants additional distress, and that ultimately, in my view, the party was never equipped to appropriately deal with the issue…" More>>

A recent trip to China has raised questions over who the Opposition leader Simon Bridges met with and why... Anne-Marie Brady, a Canterbury University professor and expert on Chinese politics, has described Guo Shengkun as the leader of the Chinese secret police. More>>

Torture is a crime under international law. New Zealand has signed (a) the UN convention against torture and (b) formal agreements about how armed conflict should be conducted. That’s the legal backdrop to the fascinating report released this week by the SIS Inspector-General.